Metropolitan Bank & Trust Co. (Metrobank) grew its profit in the first nine months by 12.4 percent to P35.7 billion as demand for business loans rose and coverage for bad loans decreased.

This translated to a 12.9 percent growth in return on equity from the 12.8 percent recorded last year.

In a statement to the Philippine Stock Exchange on Tuesday, Metrobank said its net interest income rose by 11 percent to P85.7 billion as gross loans jumped by 15.6 percent.

Lending to businesses grew faster by 16.6 percent than consumer loans with a 12.3 percent growth compared to the year-ago levels.

Credit cards and auto loans mainly drove higher consumer loans, with a combined 16.6 percent growth.

Positive impact

“We look forward to the positive impact of recent regulatory measures on the banking industry alongside improving economic outlook,” Metrobank president Fabian Dee.

These figures came after the Bangko Sentral ng Pilipinas eased its policy rate to private banks by a total of 50 basis points toward 6 percent in its monetary policy meetings in August and October.

On 25 October, the central bank also started implementing a lower reserve requirement ratio for universal and commercial banks at 7 percent from 9 percent, allowing these banks to lend more to clients at cheaper costs.

Meanwhile, non-performing loans (NPL) ratio improved to 1.59 percent, resulting in lower provisions for bad loans by 48.2 percent.

Still, Metrobank said it kept a high NPL coverage at 161.9 percent as a cautionary measure against risks.

Total deposits remained substantial at P2.3 trillion, with the bulk or 62 percent consisting of current and savings accounts at a low savings rate.

As interest income surpassed depositor liabilities, the bank said net interest margin improved to 3.9 percent as of September.

Strong drive

“Our robust results reflect our strong drive to continue supporting the growing needs of our clients, all while preserving the health of our portfolio,” Dee said.

However, operating costs rose by 11.2 percent to P57 billion due to investments in manpower, marketing, and information technology.

Metrobank’s consolidated assets stood at P3.34 trillion, maintaining its status as the country’s second largest private universal bank. Meanwhile, total equity reached P380.1 billion.